In the realm of cryptocurrency, meme coins are usually seen as humorous tokens with no substantial value. However, the Trump family has cleverly turned a meme coin associated with the former president into lucrative assets, amassing significant funds and even providing access to him personally.
Since the coin’s introduction earlier this year, it has amassed over $320 million in fees for its creators, as reported by Chainalysis, a blockchain analysis firm. Recently, Trump advertised a dinner set for May 22, open to individuals purchasing a sufficient amount of these coins.
The details of the event stipulate that the top 220 holders of the meme coin will be invited to a dinner at Trump’s golf club near Washington. Additionally, the top 25 holders gain exclusive access to a pre-dinner reception with Trump.
“Let the President know how many $TRUMP coins YOU own!” urges the promotional content on the coin’s website.
Following the dinner announcement, trading activity and the coin’s price surged. Yet, the Trump family’s financial gains do not rely on selling these coins.
Cryptocurrency is fundamentally decentralized, with Bitcoin—an originator in the space—as a precursor, emerging after the 2008 financial crisis as a bank-independent digital currency.
The Trump meme coin is traded on decentralized exchanges, which enable direct trading without intermediaries, handled by what’s known as liquidity pools. These pools facilitate efficient and instant trades by pairing the $TRUMP coin with more widely traded cryptocurrencies.
Initially, 20% out of the planned 1 billion Trump meme coins were released, half available for public sale and half into a liquidity pool. CIC Digital, tied to the Trump Organization, alongside another company, benefits from trading activities involving these meme coins.
By charging minimal fees on trades conducted through liquidity pools, the creators draw monetary gain.
“You don’t really care about what happens to the price. You only care that there is continuous volume,” noted Nicolai Søndergaard from blockchain analytics firm Nansen. “Because the more volume there is, that means more trades and therefore more fees for you.”
Based on blockchain records, Chainalysis identified that over $1.3 million in trading fees were generated within a week of the dinner announcement. The coin’s valuation increased, moving from approximately $9 to around $14 and settling around $11.
Trump distances himself from financial gains. Despite its role in his political and financial synergy, Trump distances himself from actively tracking or profiting from the meme coin. While ethics agreements limit his direct involvement, critics remain skeptical.
The Trump meme coin’s remaining 80% are locked under specific allocations, though former president Trump claims to refrain from monitoring the coin’s market fluctuations.
The team behind the coin actively promotes event participation and involvement. They encourage engagement through contests and incentivize holders with potential rewards, such as Trump-themed timepieces.
Earlier this week, a private fundraiser labeled “Crypto & AI Innovators Dinner,” backed by Trump’s MAGA Inc. super PAC, took place, with hefty attendance fees. However, details remain sparse as to who attended due to a lack of obligatory public disclosures.
Concerns rise over the anonymity cryptocurrency offers, potentially allowing undue influence via significant purchases of Trump-related digital assets. However, the official site assures privacy in the registration process.
The leaderboard on the Trump meme coin website ranks participants not only based on coin holdings but also the duration, motivating those on the verge to acquire more. “You’re so close. FIGHT FIGHT FIGHT for your $TRUMP dinner,” it states.